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respondent and to refute respondent’s proposed deficiency.
Respondent had substantially completed his audit of petitioner at
that time, and Mr. Ozenne was called upon to negotiate with
Revenue Agent Caprio, who was conducting the audit of petitioner.
When Mr. Chiate called Mr. Ozenne as a witness for
petitioner, Mr. Ozenne took the witness stand, carrying with him
a bundle of notes.
Mr. Chiate asked Mr. Ozenne to explain to the Court what he
had done to document the fact that there was no deficiency for
the year at issue. He was asked to “start from the beginning,
and just explain to the Court what you’ve done in that respect.”
Counsel for respondent was otherwise occupied, and the Court
asked the witness what he was referring to. The Court was
informed that the witness had made notes of points that he wanted
to cover in his testimony although he opined that he probably
could not cover his material if Mr. Chiate did not inquire.
Mr. Chiate agreed with Mr. Ozenne’s observation and then
informed the Court that he would be using Mr. Ozenne’s notes for
examination. Respondent did not object, and the interrogation
proceeded.
Mr. Ozenne testified that he met with Mr. Caprio,
respondent’s auditing agent, and they discussed the subject of
overrings. Mr. Caprio agreed that overrings were included in
respondent’s determination of unreported income, and he reduced
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